§ John RobertsonTo ask the Chancellor of the Exchequer what steps his Department is taking to prevent banks and insurance companies from selling unsuitable insurance policies to pensioners; and what redress can be offered to customers in such circumstances. [171772]
§ Ruth KellyThe selling of qualifying contracts of long-term insurance (broadly speaking long-term insurance policies that are not pure protection products) is already regulated by the Financial Services Authority (FSA). Any firm which makes a recommendation to a customer must ensure that the contract is suitable to the customer's demands and needs, and this applies to pensioners as to other consumers.
The FSA will regulate the selling of general insurance contracts from 14 January 2005. This regime will also introduce suitability standards such that any firm which makes a recommendation to a customer must ensure that the contract is suitable to the customer's demands and needs. This also applies to pensioners as to other consumers.